Question

Marin Company owes $225,000 plus $20,200 of accrued interest to Headland State Bank. The debt is...

Marin Company owes $225,000 plus $20,200 of accrued interest to Headland State Bank. The debt is a 10-year, 10% note. During 2020, Marin’s business deteriorated due to a faltering regional economy. On December 31, 2020, Headland State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $317,000, accumulated depreciation of $174,350, and a fair value of $202,000.

a) Prepare journal entries for Marin Company and Headland State Bank to record this debt settlement. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Marin Company owes $225,000 plus $20,200 of accrued interest to Headland State Bank. The debt is...
Marin Company owes $225,000 plus $20,200 of accrued interest to Headland State Bank. The debt is a 10-year, 10% note. During 2020, Marin’s business deteriorated due to a faltering regional economy. On December 31, 2020, Headland State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $317,000, accumulated depreciation of $174,350, and a fair value of $202,000. a) Prepare journal entries for Marin Company and Headland State Bank to record this...
Grouper Co. owes $198,200 to Monty Inc. The debt is a 10-year, 11% note. Because Grouper...
Grouper Co. owes $198,200 to Monty Inc. The debt is a 10-year, 11% note. Because Grouper Co. is in financial trouble, Monty Inc. agrees to accept some land and cancel the entire debt. The property has a book value of $98,000 and a fair value of $141,200. (a) Prepare the journal entry on Grouper’s books for debt restructure. (b) Prepare the journal entry on Monty’s books for debt restructure. (If no entry is required, select "No Entry" for the account...
On January 1, 2017, Marin Co. leased a building to Headland Inc. The relevant information related...
On January 1, 2017, Marin Co. leased a building to Headland Inc. The relevant information related to the lease is as follows. 1. The lease arrangement is for 10 years. 2. The leased building cost $4,165,000 and was purchased for cash on January 1, 2017. 3. The building is depreciated on a straight-line basis. Its estimated economic life is 50 years with no salvage value. 4. Lease payments are $275,500 per year and are made at the end of the...
On April 1, 2020, Indigo Corporation assigns $490,000 of its accounts receivable to First National Bank...
On April 1, 2020, Indigo Corporation assigns $490,000 of its accounts receivable to First National Bank as collateral for a $200,000 loan that is due July 1, 2020. The assignment agreement calls for Indigo to continue to collect the receivables. First National Bank assesses a finance charge of 4% of the accounts receivable, and interest on the loan is 8%, a realistic rate for a note of this type. Prepare the April 1, 2020 journal entry for Indigo Corporation. (Credit...
Headland Corporation hired a total of 18 new full-time employees on January 1, 2020. The employees...
Headland Corporation hired a total of 18 new full-time employees on January 1, 2020. The employees are paid $770 per week, and no changes in this pay are expected for the following year. Each employee earns three weeks of vacation time during 2020, but no new employees take any vacation time during 2020, due to Headland’s company policy that vacations must be earned before they are taken. In 2021, 4 new employees took three weeks of vacation time, and 8...
Marin Company issues 4,400 shares of restricted stock to its CFO, Dane Yaping, on January 1,...
Marin Company issues 4,400 shares of restricted stock to its CFO, Dane Yaping, on January 1, 2017. The stock has a fair value of $130,000 on this date. The service period related to this restricted stock is 4 years. Vesting occurs if Yaping stays with the company for 4 years. The par value of the stock is $4. At December 31, 2018, the fair value of the stock is $135,000. (a) Prepare the journal entries to record the restricted stock...
Exercise 5-05 On June 10, Marin Company purchased $7,300 of merchandise from Cullumber Company, on account,...
Exercise 5-05 On June 10, Marin Company purchased $7,300 of merchandise from Cullumber Company, on account, terms 3/10, n/30. Marin pays the freight costs of $360 on June 11. Goods totaling $500 are returned to Cullumber for credit on June 12. On June 19, Marin Company pays Cullumber Company in full, less the purchase discount. Both companies use a perpetual inventory system. Prepare separate entries for each transaction on the books of Marin Company. (If no entry is required, select...
The following amortization and interest schedule reflects the issuance of  10-year bonds by Headland Corporation on January...
The following amortization and interest schedule reflects the issuance of  10-year bonds by Headland Corporation on January 1, 2011, and the subsequent interest payments and charges. The company’s year-end is December 31, and financial statements are prepared once yearly. Amortization Schedule Year Cash Interest Amount Unamortized Carrying Value 1/1/2011 $ 24,975 $  196,025 2011 $ 22,100 $ 23,523 23,552 197,448 2012 22,100 23,694 21,958 199,042 2013 22,100 23,885 20,173 200,827 2014 22,100 24,099 18,174 202,826 2015 22,100 24,339 15,935 205,065 2016 22,100...
Blossom Company issued $579,000 of 9%, 10-year bonds on January 1, 2020, at face value. Interest...
Blossom Company issued $579,000 of 9%, 10-year bonds on January 1, 2020, at face value. Interest is payable annually on January 1. Your answer is incorrect. Try again. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1, 2020 LINK TO TEXT Your answer is partially correct. Try again. Prepare the journal entry to record the...
On September 1, 2020, Crane Corp. sold at 104 (plus accrued interest) 5,370 of its $1,000...
On September 1, 2020, Crane Corp. sold at 104 (plus accrued interest) 5,370 of its $1,000 face value, 10–year, 8% non–convertible bonds with detachable stock warrants. Each bond carried 2 detachable warrants; each warrant was for one common share at a specified option price of $12 per share. Shortly after issuance, the warrants were selling for $6 each. Assume that no fair value is available for the bonds. Interest is payable on December 1 and June 1. Crane Corp. prepares...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT